:00:36. > :00:40.Morning, folks. Welcome to the Sunday Politics.
:00:41. > :00:44.Labour's been hit hard by scandals at the Co-op. Ed Miliband says the
:00:45. > :00:47.Tories are mudslinging. We'll speak to Conservative Chairman Grant
:00:48. > :00:49.Shapps. Five years on from the financial
:00:50. > :00:53.crisis, and we're still talking about banks in trouble. Why haven't
:00:54. > :00:58.the regulators got the message? We'll ask the man who runs the
:00:59. > :01:01.City's new financial watchdog. And he used to have a windmill on
:01:02. > :01:06.his roof and talked about giving hugs to hoodies and huskies. These
:01:07. > :01:14.days, not so much. Has the plan to make the Conservative Party more
:01:15. > :01:19.In the South East, it is the season to be sharpening `` shopping. We
:01:20. > :01:27.homelessness and population ships. What is the evidence?
:01:28. > :01:32.And as always, the political panel that reaches the parts other shows
:01:33. > :01:35.can only dream of. Janan Ganesh Helen Lewis and Nick Watt. They ll
:01:36. > :01:40.be tweeting faster than England loses wickets to Australia. Yes
:01:41. > :01:43.they're really that fast. First, some big news overnight from
:01:44. > :01:46.Geneva, where Iran has agreed to curb some of its nuclear activities
:01:47. > :01:51.in return for the partial easing of sanctions. Iran will pause the
:01:52. > :02:01.enrichment of uranium to weapons grade and America will free up some
:02:02. > :02:04.funds for Iran to spend. May be up to $10 billion. A more comprehensive
:02:05. > :02:07.deal is supposed to be done in six months. Here's what President Obama
:02:08. > :02:16.had to say about this interim agreement. We have pursued intensive
:02:17. > :02:20.diplomacy, bilaterally with the Iranians, and together with our
:02:21. > :02:24.partners, the United Kingdom, France, Germany, Russia and China,
:02:25. > :02:30.as well as the European Union. Today, that diplomacy opened up a
:02:31. > :02:36.new path towards a world that is more secure, a future in which we
:02:37. > :02:42.can verify that Iraq and's nuclear programme is peaceful, and that it
:02:43. > :02:46.cannot build a nuclear weapon. President Obama spoke from the White
:02:47. > :02:52.House last night. Now the difficulty begins. This is meant to lead to a
:02:53. > :02:58.full-scale agreement which will effectively end all sanctions, and
:02:59. > :03:02.end Iran's ability to have a bomb. The early signs are pretty good The
:03:03. > :03:08.Iranian currency strengthened overnight, which is exactly what the
:03:09. > :03:15.Iranians wanted. Inflation in Iraq is 40%, so they need a stronger
:03:16. > :03:19.currency. -- information in Iran. France has played a blinder. It was
:03:20. > :03:22.there intransigence that led to this. Otherwise, I think the West
:03:23. > :03:28.would have led to a much softer deal. The question now becomes
:03:29. > :03:34.implementation. Here, everything hinges on two questions. First, who
:03:35. > :03:39.is Hassan Rouhani? Is he the Iranians Gorbachev, a serious
:03:40. > :03:45.reformer, or he's here much more tactical and cynical figure? Or
:03:46. > :03:48.within Iran, how powerful is he There are military men and
:03:49. > :03:56.intelligence officials within Iran who may stymie the process. The
:03:57. > :04:00.Western media concentrate on the fact that Mr Netanyahu and the
:04:01. > :04:05.Israelis are not happy about this. They don't often mention that the
:04:06. > :04:10.Arab Gulf states are also very apprehensive about this deal. I read
:04:11. > :04:20.this morning that the enemies of Qatar and Kuwait went to Saudi king.
:04:21. > :04:26.-- the MAs row. That is the key thing to watch in the next couple of
:04:27. > :04:31.weeks. There was a response from Saudi Arabia, but it came from the
:04:32. > :04:35.Prime Minister of Israel, who said this was a historic mistake. The
:04:36. > :04:39.United States said there would be no enrichment of uranium to weapons
:04:40. > :04:43.grade. In the last few minutes, the Iranian Foreign Minister has tweeted
:04:44. > :04:53.to say that there is an inalienable right -- right to enrich. The key
:04:54. > :04:57.thing is the most important thing that President Obama said in his
:04:58. > :05:01.inaugural speech. He reached out to Iran. It failed under President
:05:02. > :05:08.McKenna jab. Under President Rouhani, there seems to be progress.
:05:09. > :05:12.There is potentially now what he talked about in that first inaugural
:05:13. > :05:19.address potentially coming through. In the end, the key issue - and we
:05:20. > :05:23.don't know the answer - is the supreme leader, not the president.
:05:24. > :05:28.Will the supreme leader agreed to Iran giving up its ability to create
:05:29. > :05:34.nuclear weapons? This is the huge ambiguity. Ayatollah Khamenei
:05:35. > :05:39.authorise the position that President Rouhani took to Geneva.
:05:40. > :05:45.That doesn't mean he will sign off on every bit of implementation over
:05:46. > :05:50.the next six months. Even when President Ahmadinejad was president,
:05:51. > :05:56.he wasn't really President. We in the West have to resort to a kind of
:05:57. > :06:06.Iranians version of the study of the Kremlin, to work out what is going
:06:07. > :06:13.on. And the problem the president faces is that if there is any
:06:14. > :06:17.sign... He can unlock these funds by executive order at the moment, but
:06:18. > :06:22.if he needs any more, he has to go to Congress. Both the Democrat and
:06:23. > :06:29.the Republican side have huge scepticism about this. And he has
:06:30. > :06:33.very low credibility now. There s already been angry noises coming
:06:34. > :06:37.from quite a lot of senators. It was quite strange to see that photo of
:06:38. > :06:41.John Kerry hugging Cathy Ashton as if they had survived a ship great
:06:42. > :06:52.together. John Kerry is clearly feeling very happy. We will keep an
:06:53. > :06:54.eye on this. It is a fascinating development.
:06:55. > :06:57.More lurid details about the personal life of the Co-op Bank s
:06:58. > :07:02.disgraced former chairman, the Reverend Paul Flowers. The links
:07:03. > :07:05.between Labour, the bank and the wider Co-op movement have caused big
:07:06. > :07:09.problems for Ed Miliband this week, and the Conservatives have been
:07:10. > :07:14.revelling in it. But do the Tory allegations - Ed Miliband calls them
:07:15. > :07:23."smears" - stack up? Party Chairman Grant Shapps joins us from Hatfield.
:07:24. > :07:32.Welcome to the programme. When it comes to the Co-op, what are you
:07:33. > :07:36.accusing Labour of knowing and when? I think the simple thing to say here
:07:37. > :07:42.is that the Co-op is an important bank. They have obviously got into
:07:43. > :07:46.difficulty with Reverend flowers, and our primary concern is making
:07:47. > :07:49.sure that that is properly investigated, and that we understand
:07:50. > :07:52.what happened at the bank and how somebody like Paul Flowers could
:07:53. > :07:58.have ended up thing appointed chairman. You wrote to edge Miliband
:07:59. > :08:05.on Tuesday and asked him what he knew and when. -- you wrote to Ed
:08:06. > :08:09.Miliband. But by Prime Minister s Questions on Wednesday, David
:08:10. > :08:16.Cameron claims that you knew that Labour knew about his past all
:08:17. > :08:22.along. What is the evidence for that? We found out by Wednesday that
:08:23. > :08:27.he had been a Labour councillor Reverend Flowers, and had been made
:08:28. > :08:31.to stand down. Certainly, Labour knew about that, but somehow didn't
:08:32. > :08:38.seem to think that that made him less appropriate to be the chairman
:08:39. > :08:44.of the Co-op bank. There was no evidence that Mr Miliband or Mr
:08:45. > :08:49.Balls knew about that. I ask you again, what are you accusing the
:08:50. > :08:59.Labour leadership of knowing? We know now that he stood down for very
:09:00. > :09:02.inappropriate images on his computer, apparently. You are
:09:03. > :09:06.telling me that they didn't know. I am not sure that is clear at all. I
:09:07. > :09:10.have heard conflicting reports. There is a much bigger argument
:09:11. > :09:16.about what they knew and when. There was a much bigger issue here. This
:09:17. > :09:20.morning, Ed Miliband has said that they don't have to answer these
:09:21. > :09:23.questions and that these smears This is ludicrous. These are
:09:24. > :09:27.important questions about an important bank, how it ended up
:09:28. > :09:34.getting into this position, and how a disastrous Britannia -- Italia
:09:35. > :09:41.deal happen. -- Britannia deal happened. And we need to know how
:09:42. > :09:44.the bank came off the rails. To be accused of smears for asking the
:09:45. > :09:49.questions is ridiculous. I am just trying to find out what you are
:09:50. > :09:55.accusing Labour of. You saying that the Labour leadership knew about the
:09:56. > :10:04.drug-taking? Sorry, there was some noise here. I don't know what was
:10:05. > :10:08.known and when. We do know that Labour, the party, certainly knew
:10:09. > :10:13.about these very difficult circumstances in which he resigned
:10:14. > :10:18.as a councillor. I think that the Labour Party knew about it. We knew
:10:19. > :10:22.that Bradford did, but not London. Are you saying that Ed Miliband knew
:10:23. > :10:27.about the inappropriate material on the Reverend's laptop? It is
:10:28. > :10:34.certainly the case that Labour knew about it. But did Mr Miliband know
:10:35. > :10:41.about it, and his predilection for rent boys? He will need to answer
:10:42. > :10:46.those questions. It is quite proper to ask those questions. Surely,
:10:47. > :10:50.asking a perfectly legitimate set of questions, not just about that but
:10:51. > :10:54.about how we have ended up in a situation where this bank has made
:10:55. > :11:00.loans to Labour for millions of pounds, that bank and the Unite
:11:01. > :11:07.bank, who is connected to it. And how they made a ?50,000 donation to
:11:08. > :11:12.Ed Balls' office. Ed Balls says that was nothing to do with Reverend
:11:13. > :11:17.Flowers, and yet Reverend Flowers said that he personally signed that
:11:18. > :11:21.off. Lots of questions to answer. David Cameron has already answered
:11:22. > :11:27.them on Wednesday. He said that you now know that Labour knew about his
:11:28. > :11:30.past all along. You have not been able to present evidence that
:11:31. > :11:36.involve Mr Miliband or Mr Balls in that. So until you get that, surely
:11:37. > :11:40.you should apologise? Hang on. He said that Labour knew about this,
:11:41. > :11:46.and they did, because he stood down as a councillor. If Ed Miliband
:11:47. > :11:51.didn't know about that, then why not? This was quite a serious thing
:11:52. > :11:55.that happened. The wider point is about why it is that when you ask
:11:56. > :11:59.perfectly legitimate questions about this bank, about the Britannia deal,
:12:00. > :12:09.and about the background of Mr flowers, why is the response, it is
:12:10. > :12:12.all smears? There are questions about how Labour failed to deal with
:12:13. > :12:16.the deficit and how it hasn't done anything to support the welfare
:12:17. > :12:25.changes, but there is nothing about that. Let us -- lets: To the wider
:12:26. > :12:33.picture of the Co-operative Bank. Labour wanted the Co-op to take over
:12:34. > :12:38.the Britannia Building Society, and it was a disaster. Do you accept
:12:39. > :12:45.that? The government of the day has to be a part of these discussions
:12:46. > :12:50.for regulatory reason. The government in 2009 - Ed Balls was
:12:51. > :12:57.very pleased... But you supported that decision. There was a later
:12:58. > :13:01.deal, potentially, for the Co-op to buy those Lloyds branches. There was
:13:02. > :13:08.a proper process and it didn't go through just recently. If there had
:13:09. > :13:15.been a proper process back in 2 09, would the Britannia deal have gone
:13:16. > :13:20.through? First, you accept that the Tories were in favour of the
:13:21. > :13:24.Britannia take over. Then your Chancellor Osborne went out of his
:13:25. > :13:28.way to facilitate the purchase of the Lloyds branches, even though you
:13:29. > :13:35.had no idea that the Co-op had the management expertise to become a
:13:36. > :13:41.super medium. Correct? The difference is that that deal didn't
:13:42. > :13:48.go through. There was a proper process that took place. Let's look
:13:49. > :13:54.at the process. There was long indications as far back as January
:13:55. > :13:59.2012 that the Co-op, as a direct result of the Britannia take over
:14:00. > :14:03.which you will party supported, was unfit to acquire the Lloyds
:14:04. > :14:10.branches. By January 2012, the Chancellor and the Treasury ignored
:14:11. > :14:13.the warnings. Wide? In 2009, there was political pressure for the
:14:14. > :14:18.Britannia to be brought together. Based on the information available,
:14:19. > :14:21.this was supported, but that process ended up with a very, very
:14:22. > :14:27.problematic takeover of the Britannia. Wind forward to this
:14:28. > :14:30.year, and when the same types of issues were being looked at for the
:14:31. > :14:35.purchase of the Lloyds deal, the proper process was followed, this
:14:36. > :14:39.time with us in government, and that purchase didn't go through. It is
:14:40. > :14:42.important that the proper process is followed, and when it was, it
:14:43. > :14:52.transpired that the deal wasn't going to be done. But it was the
:14:53. > :14:57.Treasury and the Chancellor who were the cheerleaders for the acquisition
:14:58. > :15:01.of the Lloyds branches. But there was a warning that the Co-op did not
:15:02. > :15:04.have enough capital on its balance sheet to make those acquisitions,
:15:05. > :15:10.but instead of heeding those warnings, your people went to
:15:11. > :15:15.Brussels to lobby for the requirements to be relaxed - why on
:15:16. > :15:19.earth did you do that? Our Chancellor went to argue for all of
:15:20. > :15:24.Rajesh banking, not specifically for the Co-op. He was arguing for the
:15:25. > :15:29.mutuals to be given a special ruling. The idea was to make sure
:15:30. > :15:35.that every bank in Britain could have a better deal, particularly the
:15:36. > :15:38.mutuals, as you say. That is a proper thing for the Chancellor to
:15:39. > :15:42.be doing. We could go round in circles here, but in the end, there
:15:43. > :15:47.was not a takeover of the Lloyds branches, that is because we
:15:48. > :15:51.followed a proper process. Had that same rigorous process been followed
:15:52. > :15:55.in 2009, the legitimate question to ask is whether the Co-op would have
:15:56. > :15:59.been -- would have taken over the Britannia. That is a proper question
:16:00. > :16:03.to ask. It is no good to have the leader of the opposition say, as
:16:04. > :16:06.soon as you ask any of these questions about anything where there
:16:07. > :16:11.is a problem for them, they come back with, oh, this is all smears.
:16:12. > :16:14.There are questions to ask about what the Labour government did, the
:16:15. > :16:20.debt and the deficit they left the country with, the way they stopped
:16:21. > :16:25.work from paying in this country. The big question your government has
:16:26. > :16:28.two answer is, why, by July 201 , when it was clear there was a black
:16:29. > :16:33.hole in the Co-op's balance sheet, your government re-confirmed the
:16:34. > :16:38.Co-op as the preferred bidder for Lloyds - why would you do that?
:16:39. > :16:42.Well, look, the good thing is, we can discuss this until the cows come
:16:43. > :16:46.home, but there is going to be a proper, full investigation, so we
:16:47. > :16:51.will find out what happened, all the way back. So, we will be able to get
:16:52. > :16:55.to the bottom of all of this. Grant Shapps, the only reason the Lloyds
:16:56. > :17:01.deal did not go ahead was, despite the Treasury cheerleading, when
:17:02. > :17:04.Lloyds began its due diligence, it found that there was indeed a huge
:17:05. > :17:09.black hole in the balance sheet and that the Co-op was not fit to take
:17:10. > :17:14.over its branches. That wasn't you, it wasn't the Government, it was not
:17:15. > :17:20.the Chancellor, it was Lloyds. You were still cheerleading for the deal
:17:21. > :17:24.to go ahead... Well, as I say, a proper process was followed, which
:17:25. > :17:28.did not result in the purchase of the Lloyds branches. At that proper
:17:29. > :17:33.process been followed with the purchase of the Britannia, under the
:17:34. > :17:38.previous government... Which you supported. Yes, but it may well be
:17:39. > :17:42.that under that previous deal, there was a excess political pressure
:17:43. > :17:50.perhaps put on in order to create that merger, which proved so
:17:51. > :17:55.disastrous. The Tories facilitated it, Grant Shapps, they allowed it to
:17:56. > :17:59.go ahead. I have said, we are going to have a proper, independent
:18:00. > :18:03.review. What I cannot understand is, when you announce a robber,
:18:04. > :18:10.independent review, the response you get to these serious questions. The
:18:11. > :18:15.response is, oh, this is a smear. It is crazy. We are trying to answer
:18:16. > :18:25.the big questions for this country. We have done all of that, and we are
:18:26. > :18:27.out of time. The Reverend Flowers' chairmanship of the Co-op bank was
:18:28. > :18:33.approved by the regulator at the time, which no longer exists. It was
:18:34. > :18:37.swept away by the coalition government in a supposed revolution
:18:38. > :18:40.in regulation. But will its replacement, the Financial Conduct
:18:41. > :18:49.Authority, be different? Adam has been to find out. Come with me for a
:18:50. > :18:54.spin around the Square mile to find out how we regulate our financial
:18:55. > :18:59.sector, which is almost five times bigger than the country's entire
:19:00. > :19:04.annual income. First, let's pick up our guide, journalist Iain Martin,
:19:05. > :19:10.who has just written a book about what went so wrong during the
:19:11. > :19:12.financial crisis. The FSA was an agency which was established to
:19:13. > :19:17.supervise the banks on a day-to day basis. The Bank of England was
:19:18. > :19:21.supposed to have overall responsible at for this to Bolivia the financial
:19:22. > :19:25.system and the Treasury was supposed to take an interest in all of these
:19:26. > :19:31.things. The disaster was that it was not anyone's call responsibility, or
:19:32. > :19:34.main day job, to stay alert as to whether or not the banking system as
:19:35. > :19:38.a whole was being run in a safe manner. And so this April, a new
:19:39. > :19:48.system was set up to police the City. Most of the responsibly delays
:19:49. > :19:51.here, with the Bank of England, and its new Prudential Regulation
:19:52. > :19:55.Authority. And the Financial Services Authority has been replaced
:19:56. > :20:01.with the new Financial Conduct Authority. Can we go to the
:20:02. > :20:06.financial conduct authority, please? Canary Wharf, thank you. Here, it is
:20:07. > :20:09.all about whether the people in financial services are playing by
:20:10. > :20:15.the rules, in particular, how they treat their customers. This place
:20:16. > :20:18.has got new powers, like the ability to ban products it does not like, a
:20:19. > :20:22.new mandate to promote competition in the market, the concept being,
:20:23. > :20:27.more competition means a better market, plus the idea that a new
:20:28. > :20:34.organisation rings a whole new culture. Although these are the old
:20:35. > :20:39.offices of the FSA, so maybe not quite so new after all. It has also
:20:40. > :20:43.inherited the case of the Co-op bank and its disgraced former chairman
:20:44. > :20:46.the Reverend Paul Flowers. The SCA will be part of the investigation
:20:47. > :20:51.into what happened, which will probably involve looking at its own
:20:52. > :20:55.conduct. One member of the Parliamentary commission into
:20:56. > :21:01.banking wonders whether the new regulator, and its new boss, are up
:21:02. > :21:05.to it. I have always said, it is not the architecture which is the issue,
:21:06. > :21:09.it is the powers that the regulator has, and today, it does not seem to
:21:10. > :21:15.me as if there is any increase in that. And with the unfolding scandal
:21:16. > :21:22.at the Co-op, it feels like the new architecture for regulating the City
:21:23. > :21:25.is now facing its first big test. And the chief executive of the
:21:26. > :21:31.Financial Conduct Authority, the SCA, Martin Wheatley, joins me now.
:21:32. > :21:34.Welcome to The Sunday Politics. The failure of bank regulation was one
:21:35. > :21:40.of the clearest lessons of the crash in 2008, and yet two years later, in
:21:41. > :21:46.2010, Paul Flowers is allowed to become chairman of the Co-op - why
:21:47. > :21:50.have we still not got the regulation right? We have made a lot of changes
:21:51. > :21:55.since then. We have created a new regulator, as you know. At the time,
:21:56. > :21:58.we still had a process which allowed somebody to be appointed to a bank
:21:59. > :22:02.and they would go through a challenge, but in the case of Paul
:22:03. > :22:04.Flowers, there was no need for an additional challenge when he was
:22:05. > :22:11.appointed to chairman, because he was already on the board. But going
:22:12. > :22:16.from being on the board to becoming chairman, that is a big jump, and he
:22:17. > :22:20.only had one interview? That is why today, it would be different. But
:22:21. > :22:25.the truth is, that was the system at the time, the system which the FSA
:22:26. > :22:29.operated. He was challenged, we did challenge him, and we said, you do
:22:30. > :22:33.not have the right experience, but at the time, we would not have
:22:34. > :22:36.opposed the appointment. What we needed was additional representation
:22:37. > :22:41.of the board of people who did have banking experience. You can say that
:22:42. > :22:46.that was then and this is now, but up until April of this year, it was
:22:47. > :22:49.still the plan for the Co-op, under Mr Flowers, and despite being
:22:50. > :22:55.seriously wounded by the Britannia takeover, to take on 632 Lloyds
:22:56. > :22:59.branches. That was the Co-op's plan. They needed to pass our test
:23:00. > :23:03.as to whether we thought they were fit to do that, and frankly, they
:23:04. > :23:08.never passed that test. It was not the regulator that stopped them It
:23:09. > :23:12.was. We were constantly pushing back, saying, you have not got the
:23:13. > :23:14.capital, you have no got the systems, and ultimately, they
:23:15. > :23:20.withdrew, when they could not answer our questions. You were asking the
:23:21. > :23:25.right questions, I accept that, but all of the time, the politicians on
:23:26. > :23:29.all sides, they were pushing for it to happen, and I cannot find
:23:30. > :23:35.anywhere where the regulator said, look, this is just not going to
:23:36. > :23:38.happen. I cannot comment on what the politicians were doing, but I
:23:39. > :23:41.continue what we were doing, which was constantly asking the Co-op
:23:42. > :23:46.have you got the systems in place, have you got the people, have you
:23:47. > :23:50.got the capital? And they didn't. But it only came to a head when
:23:51. > :23:53.Lloyds started its own due diligence on the bank, and they discovered
:23:54. > :23:58.that it was impossible for them to take over the branches, it was not
:23:59. > :24:03.the regulator... In fairness, what we do is ask the questions, can you
:24:04. > :24:07.do this deal? And we kept pushing back, and we never frankly got
:24:08. > :24:14.delivered a business plan which we were happy to approve. Is the SCA
:24:15. > :24:25.going to launch its own inquiry into what happened? -- the FCA. The
:24:26. > :24:30.Chancellor has announced what will be a very broad inquiry. There are a
:24:31. > :24:35.number of specifics which we will be able to look at, relating to events
:24:36. > :24:39.over the last five years. Could there be a police investigation I
:24:40. > :24:43.think the police have already announced an investigation. I am
:24:44. > :24:47.talking about into the handling of the bank. It depends. There might
:24:48. > :24:56.be, if there is grim low activity, which we do not know yet. You worked
:24:57. > :25:03.at the FS eight, didn't you? I did. Some of those people who were signed
:25:04. > :25:09.off on the speedy promotion of Mr Flowers, are they now working
:25:10. > :25:12.there? Yes, we have some. I came to join the Financial Services
:25:13. > :25:18.Authority, to lead it into the creation of the new body, the SCA.
:25:19. > :25:29.We had people who were challenging and they did the job. There was not
:25:30. > :25:32.a requirement to approve the role as chairman. There was not even a
:25:33. > :25:37.requirement to interview at that stage. What we did do was to require
:25:38. > :25:49.that he was interviewed, and that the Co-op should get additional
:25:50. > :25:54.experience. One of the people from the old organisation, who signed up
:25:55. > :25:57.on the promotion of Mr Flowers to become chairman is now a
:25:58. > :26:04.nonexecutive director of the Co op, so how does that work? Welcome he
:26:05. > :26:07.was a senior adviser to our organisation, one of the people who
:26:08. > :26:12.made the challenges, and who said, you need more experience on your
:26:13. > :26:16.board. Subsequently he then went and joined the board. Surely that should
:26:17. > :26:21.not be allowed, the regulator and the regulated should not be like
:26:22. > :26:26.that. Well clearly, you need protection, but we have got to get
:26:27. > :26:30.good people in, and frankly, we want the industry to have good people in
:26:31. > :26:34.the industry, so there will be some movement between the regulator and
:26:35. > :26:37.industry. We all wonder whether you have the power or even the
:26:38. > :26:40.confidence to stand up if you look at all of the really bad bank
:26:41. > :26:45.decisions recently, politicians were behind them. It was Gordon Brown who
:26:46. > :26:50.pushed the disastrous merger of Lloyds and RBS. It was Alex Salmond
:26:51. > :26:55.who egged on RBS to buy the world. All three main parties wanted the
:26:56. > :26:59.Co-op to buy Britannia, even though they did not know the debt it would
:27:00. > :27:02.inherit, and all three wanted the Co-op to buy the Lloyds branches -
:27:03. > :27:08.how do you as a regulator stand up to that little concert party? Well,
:27:09. > :27:12.that political pressure exists, our job at the end of the day is to do a
:27:13. > :27:17.relatively technical job and say, does it stack up? And it didn't and
:27:18. > :27:20.we made that point time and time again to the Co-op board. They did
:27:21. > :27:24.not have a business case that we could approve. The bodies on left
:27:25. > :27:31.and right -- the politicians on left and right gave the Co-op special
:27:32. > :27:38.support. They may have done, but that was not you have made a warning
:27:39. > :27:42.about these payday lenders, but I think what most people would like to
:27:43. > :27:46.see is a limit put on the interest they can charge over a period of
:27:47. > :27:51.time - will you do that? We have got a whole set of powers for payday
:27:52. > :27:55.lenders. We will bring in some changes from April next year, and we
:27:56. > :27:58.will bring in further changes as we see necessary. Will you put a limit
:27:59. > :28:04.on the interest they can charge That is something we can study. You
:28:05. > :28:09.do not sound too keen on it? Well, there are a lot of changes we need
:28:10. > :28:12.to make. One change is limiting rollovers, limiting the use of
:28:13. > :28:17.continuous payment authorities. Simply jumping to one trigger would
:28:18. > :28:21.be a mistake. Finally, an issue which I think is becoming a growing
:28:22. > :28:26.concern, because the Government is thinking of subsidising them, 9 %
:28:27. > :28:31.mortgages are back - should we not be worried about that? I think we
:28:32. > :28:35.should if the market has the same experiences that we had back in 2007
:28:36. > :28:40.- oh wait. We are bringing a comprehensive package in under our
:28:41. > :28:44.mortgage market review, which will change how people lend and will put
:28:45. > :28:55.affordability back at the heart of lending decisions. -- 2007-08. You
:28:56. > :28:56.have not had your first big challenge yet, have you? We have
:28:57. > :29:06.many challenges. It was once called the battle of the
:29:07. > :29:08.mods and the rockers - the fight between David Cameron-style
:29:09. > :29:11.modernisers and old-style traditional Tories for the direction
:29:12. > :29:18.and soul of the Conservative Party. But have the mods given up on
:29:19. > :29:23.changing the brand? When David Cameron took over in 2005, he
:29:24. > :29:27.promoted himself as a new Tory leader. He said that hoodies need
:29:28. > :29:34.more love. He was talking about something called the big society. He
:29:35. > :29:38.told his party conference that it was time to that sunshine win the
:29:39. > :29:42.day. There was new emphasis on the environment, and an eye-catching
:29:43. > :29:48.trip to a Norwegian glacier to see first-hand, supposedly, the effects
:29:49. > :29:52.of global warming. This week, party modernise and Nick bone has said
:29:53. > :29:57.that the party is still seen as an old-fashioned monolith and hasn t
:29:58. > :30:05.done enough to improve its appeal. The Tories have put some reforms
:30:06. > :30:10.into practice, such as gay marriage, but they have put more into welfare
:30:11. > :30:14.reform band compassionate conservatism. David Cameron wants
:30:15. > :30:22.talked about leading the greenest government ever. Downing Street says
:30:23. > :30:29.that the quote in the Son is not recognised, get rid of the green
:30:30. > :30:32.crap. At this point in the programme we were expecting to hear from the
:30:33. > :30:34.Energy and Climate Change Minister, Greg Barker. Unfortunately, he has
:30:35. > :30:41.pulled out, with Downing Street saying it's for ""family reasons"".
:30:42. > :30:46.Make of that what you will. However, we won't be deterred. We're still
:30:47. > :30:49.doing the story, and we're joined by our very own mod and rocker - David
:30:50. > :30:55.Skelton of the think-tank Renewal, and Conservative MP Peter Bone.
:30:56. > :31:00.Welcome to you both. I'm glad your family is allowed you to come? David
:31:01. > :31:05.Skelton, getting rid of all the green crap, or words to that effect,
:31:06. > :31:07.that David Cameron has been saying. It is just a sign that Tory
:31:08. > :31:14.modernisation has been quietly buried. I do think that's right
:31:15. > :31:20.Modernisation is about reaching out to the voters, and the work to do
:31:21. > :31:25.that is now more relevant than ever. We got the biggest swing since 931,
:31:26. > :31:29.and the thing is we need to do more to reach out to voters in the North.
:31:30. > :31:38.We need to reach out to non-white voters, and show that the concerns
:31:39. > :31:42.of modern Britain and the concerns of ordinary people is something that
:31:43. > :31:46.we share. And what way will racking up electricity bills with green
:31:47. > :31:52.levies get you more votes in the North of England? We have to look at
:31:53. > :31:55.ways to reduce energy bills. The renewable energy directive doesn't
:31:56. > :32:02.do anything to help cut our emissions, but does decrease energy
:32:03. > :32:06.bills by ?45 a year. We should renegotiate that. That is a part of
:32:07. > :32:12.modernisation and doing what ordinarily people want. And old
:32:13. > :32:17.dinosaurs like you are just holding this modernisation process back I
:32:18. > :32:22.am very appreciative of covering on this programme. The Tory party has
:32:23. > :32:26.been reforming itself for more than 150 years. This idea of modern eyes
:32:27. > :32:34.a is just some invention. We are changing all the time. I'm nice and
:32:35. > :32:39.cuddly! So you are happy that the party made gay marriage almost a
:32:40. > :32:47.kind of symbol of its modernisation? Fine Mac the gay marriage was a free
:32:48. > :32:51.vote. David Cameron was recorded as a rebel there because more Tories
:32:52. > :32:55.voted against his position than ever before. It was said that this was a
:32:56. > :33:00.split between the old and young but it actually was a split between
:33:01. > :33:03.those who were religious and nonreligious. It is a
:33:04. > :33:11.misinterpretation of what happened. Is a modernisation in retreat? I
:33:12. > :33:16.think modernisation is an invention. Seven years ago, in my
:33:17. > :33:23.part of the world, we got three councillors elected, two were 8 and
:33:24. > :33:26.one was 21. A few months ago, a 25-year-old was chosen to fight
:33:27. > :33:32.Corby for the Conservative Party. He came from a comprehensive School. He
:33:33. > :33:38.was one of the youngest. The Tory party is moving on. So you found
:33:39. > :33:47.three young people? Hang on a minute. You can't get away with
:33:48. > :33:52.that. Three in one batch. Does modernisation exist? Modernisation
:33:53. > :33:55.is about watering our appeal and sharing our values are relevant to
:33:56. > :34:00.voters who haven't really thought about voting for us for decades now.
:34:01. > :34:04.Modernisation is about more than windmills and stuff, it is about
:34:05. > :34:11.boosting the life chances of the poorest, it is about putting better
:34:12. > :34:17.schools in poorer areas. It is also saying that modernisation and the
:34:18. > :34:21.Tory party... When has the Tory party been against making poorer
:34:22. > :34:25.people better off? Or against better schools? Do you think Mrs Thatcher
:34:26. > :34:28.was a moderniser when she won all those elections? The problem we have
:34:29. > :34:34.at the moment is that UKIP has grown-up. If we could get all of
:34:35. > :34:39.those people who vote UKIP to vote for us, we would get 47% of the
:34:40. > :34:44.vote. We don't need to worry about voters on the left. We need to worry
:34:45. > :34:52.about the voters in the north, those people who haven't voted for us for
:34:53. > :34:58.decades. Having an EU Referendum Bill is going to get people to
:34:59. > :35:02.vote. We have to reach out to voters, but not by some sort of
:35:03. > :35:08.London based in need. You have to broaden your base. I agree with you
:35:09. > :35:11.on that. We have to broaden our appeal, but this back to the future
:35:12. > :35:16.concept is not going to work. We need something that generally
:35:17. > :35:20.appeals to low and middle-income voters, and something that shows we
:35:21. > :35:27.genuinely care about the life chances of the poorest. Do you think
:35:28. > :35:33.that the people who vote UKIP don't support those aspirations? We are
:35:34. > :35:37.not doing enough to cut immigration. We don't have an EU Referendum Bill
:35:38. > :35:44.stop we have to get the centre right to vote for us again. Do that, and
:35:45. > :35:48.we have it. Tom Pursglove, the 5 euros, will be returned in Corby
:35:49. > :36:01.because we cannot win an election there. -- the 25-year-old. Whether
:36:02. > :36:07.you are moderniser or traditionalist, people, particularly
:36:08. > :36:15.in the North, see you as a bunch of rich men. And rich southerners. You
:36:16. > :36:20.are bunch of rich southerners. We need to do more to show that we are
:36:21. > :36:27.building on lifting the poorest out of the tax. We need to build more
:36:28. > :36:32.houses. There is a perception that the leadership at the moment is
:36:33. > :36:36.rich, and public school educated. What we have to do is get more
:36:37. > :36:42.people from state education into the top. You are going the other way at
:36:43. > :36:51.the moment. That is a fair criticism. Modernisers also say
:36:52. > :36:57.that. I went to a combo hedge of school as well. -- do a
:36:58. > :37:00.comprehensive school. We need to show that we are standing up
:37:01. > :37:07.comprehensive school. We need to income. Thank Q, both of you. You
:37:08. > :37:09.are watching the Sunday Politics. Coming up in just under 20 minutes,
:37:10. > :37:26.I will be looking Hello, I am Natalie Graham and this
:37:27. > :37:32.Sunday Politics the South East. Why is it that where you live seems to
:37:33. > :37:38.determine how long you live? We will be looking at the results of some
:37:39. > :37:44.king being done by a Sussex charity. Joining me is Richard Ashworth who
:37:45. > :37:48.was until this week leader of the Conservatives in the European
:37:49. > :37:56.Parliament. And the Labour candidate for Brighton. This week a former
:37:57. > :38:00.minister who had come out as gay survived an attempt by some local
:38:01. > :38:06.Conservatives to stop him standing as the party candidate at the next
:38:07. > :38:10.election. Some members of the party executive wanted to stop blocking
:38:11. > :38:15.because of his sexuality. What does this tell us about the modern Tory
:38:16. > :38:22.party? It tells us there is still a nice day element in the party. ``
:38:23. > :38:29.nasty. It is wrong to say that it was a personal thing. I think there
:38:30. > :38:33.were a lot of other issues that have gone over five years that he has had
:38:34. > :38:38.to reconcile with his executive, I do not know exactly what they were,
:38:39. > :38:43.it would not be right for us to assume what they were. You have had
:38:44. > :38:47.your own selection issues. You were not automatically selected by the
:38:48. > :38:51.party to stand for election in the European elections next year. Where
:38:52. > :38:59.does that leave you feeling about your party? Number three on the
:39:00. > :39:06.list. I hope I get elected. I am grateful to be there and I'm looking
:39:07. > :39:11.forward to the election. Is that a reaction to your pro`European
:39:12. > :39:14.views? I would not have thought so. I have a mainstream conservative
:39:15. > :39:19.view, Europe is there and it needs to change. We are the people that
:39:20. > :39:25.need to do the job and that is the day job for me. Why were you not
:39:26. > :39:30.automatically selected then? You would have to ask the people who did
:39:31. > :39:36.that. I do not know. Nancy, your party has at selection issues as
:39:37. > :39:44.well. You have trade union likes and that has been a `` an accusation at
:39:45. > :39:49.you. There have been lots of insinuations made and we have made
:39:50. > :39:55.it clear that there was no issues with my selection. I was selected by
:39:56. > :40:00.a members at a local meeting. It has been a damaging event for the party
:40:01. > :40:05.and will raise questions about candidates as they are selected. I
:40:06. > :40:10.do not think so. I am proud of my trade union backing. One of the good
:40:11. > :40:15.things the party has done is to bring in a much more diverse range
:40:16. > :40:19.of people into politics. We have made to change the face of
:40:20. > :40:24.Parliament, we have lots of work going on with black and ethnic
:40:25. > :40:28.minority communities. We are trying to make Parliament as representative
:40:29. > :40:34.of the community as possible. That is the goal that Oliver should be
:40:35. > :40:44.aiming for in every party. `` we should all. If you have started your
:40:45. > :40:49.Christmas shopping, you might have made some decisions. In Brighton and
:40:50. > :40:53.Hove, parking for more than four hours in the city centre can cost
:40:54. > :41:00.more than ?25 full top but last week there was some relief for drivers in
:41:01. > :41:06.the city, the will get some free parking. The aim is to help local
:41:07. > :41:11.businesses, but the plans are controversial. We will hear from the
:41:12. > :41:15.Green leader of the council. But first we went to find out why some
:41:16. > :41:20.motorists and businesses think free parking is not good.
:41:21. > :41:24.It is being hailed as a small victory for the motorist in a city
:41:25. > :41:34.that some campaigners and businesses feel has gained a reputation for
:41:35. > :41:38.being anti`car. Free parking at five Brighton and Hove car parks in the
:41:39. > :41:43.run`up to Christmas was voted through by the city council last
:41:44. > :41:45.week. The move was opposed by the minority Green administration but
:41:46. > :41:54.Labour and Conservative councillors joined forces to make sure the
:41:55. > :42:01.proposal was passed. The campaign group lobbied for the free parking.
:42:02. > :42:05.What has frightened us is the impact that the high parking charges have
:42:06. > :42:13.had on public perception of Brighton as a destination. That has fed
:42:14. > :42:17.through to a lot of trade. It is more a case of getting those
:42:18. > :42:22.messages out that Brighton is not necessarily going to cost you a
:42:23. > :42:28.fortune to use it. It is estimated the free parking bays will cost the
:42:29. > :42:33.council ?112,000. The green council leader branded the plan
:42:34. > :42:35.anti`business, saying it would cause congestion and pollution. But
:42:36. > :42:40.another other councils across the South East have regularly offered
:42:41. > :42:46.free parking to help changing the festive season as it is a time when
:42:47. > :42:50.shops these days `` stiff competition from online traders. It
:42:51. > :42:54.has been happening in Sevenoaks several years. It encourages people
:42:55. > :42:59.to come in during the peak Christmas season and that is something we are
:43:00. > :43:03.going to keep doing to do. The longer people stay, they are likely
:43:04. > :43:08.to do more things. They might stop for a copy, they might not feel
:43:09. > :43:14.under pressure to Russian and rush out, so they will browse. A lot of
:43:15. > :43:20.shops depend on people walking past. Those in favour of free parking here
:43:21. > :43:23.in Britain `` Brighton, hope it will increase the number of shoppers.
:43:24. > :43:34.There has been an overall drop of the ball `` footfall of around 11%
:43:35. > :43:40.from last year. This independent gift shop has been in business for
:43:41. > :43:43.26 years and its owner says she relies on passing trade. She
:43:44. > :43:47.welcomes the free festive parking but feels more needs to be done to
:43:48. > :43:54.encourage motorists to visit during the rest of the year. I think it is
:43:55. > :43:58.too little too late. It is a talking gesture and not enough. I would say
:43:59. > :44:01.three out of five days of the week are quiet because Babel are not
:44:02. > :44:12.coming into town in the way they used to and they are leaving early
:44:13. > :44:18.as well. `` they are not. People are leaving earlier in the day so all in
:44:19. > :44:22.all it is having a big impact. So at the time of year when local
:44:23. > :44:25.authorities are doing their best to help shops from maximising on
:44:26. > :44:30.festive trade, why is Britain's green council syllables to doing the
:44:31. > :44:35.same? The campaign which is supported by some of the city's
:44:36. > :44:42.biggest businesses and tourists attractions says it is down to the
:44:43. > :44:47.Green Party transport policy. They say cars as a source of all evil.
:44:48. > :44:50.They don't actually have any understanding that it actually
:44:51. > :44:54.brings a great deal of good into the city. Their ideology takes
:44:55. > :45:01.precedence over the needs of the city. We have an administration that
:45:02. > :45:07.doesn't understand the essential need of the motor vehicle for the
:45:08. > :45:10.business community. And that the customer is who will use a motor
:45:11. > :45:15.vehicle because that is the only means that they have of actually
:45:16. > :45:20.getting into the town. So an early president for `` present for
:45:21. > :45:21.motorists wanting to drive into Brighton to do their Christmas
:45:22. > :45:43.shopping will stop ``. Were you playing Scrooge because you
:45:44. > :45:48.were opposing the free parking on environmental grounds or because you
:45:49. > :45:52.do not think it will help local businesses? Not at all. It is a
:45:53. > :46:00.shame some of those back were wrong in that report. The ?25 parking fee
:46:01. > :46:07.you quoted, I am not of that anywhere in the city. We are talking
:46:08. > :46:11.generally about the issue. This whole issue is about council run car
:46:12. > :46:16.parks. Those are full. It is about how much the car in the centre of
:46:17. > :46:27.Brighton is a factor in the foot all been down 11%. `` footfall. Other
:46:28. > :46:30.indicators are showing improvements. The number of people on jobseeker's
:46:31. > :46:37.allowance is down, new businesses are at. Is this growth is up. Lots
:46:38. > :46:45.of people come into our city in a method other than car. That is why
:46:46. > :46:48.Brighton Station is the 30th `` 13th busiest in the country. You oppose
:46:49. > :46:52.the plan because you do not think it is a factor in the economic
:46:53. > :46:58.situation in Brighton in helping local businesses? The car parks may
:46:59. > :47:03.have mentioned are full in the run`up to Christmas. We are popular
:47:04. > :47:12.shopping destination. We do not think doing this is good for
:47:13. > :47:18.businesses. To give away free parking at Christmas is like handing
:47:19. > :47:23.out free tickets to the cinema on a Saturday afternoon when the shows
:47:24. > :47:30.are to anyway. Your party were proposing not a radically different
:47:31. > :47:34.solution. Free parking in Norton Road and Hove in a permanent cotton
:47:35. > :47:40.prices in London Road car park. So you do want free car parking to
:47:41. > :47:49.encourage people to come by car to Brighton and Hove? `` per minute cut
:47:50. > :47:53.in prices. We responded to that. The city centre is different, it was for
:47:54. > :47:59.Sundays only in response to set up a market on. That's a separate that we
:48:00. > :48:05.try and bundle up into that report just to save on committee time. You
:48:06. > :48:13.have told me that free parking is going to harm businesses. Your party
:48:14. > :48:19.was proposing a cheaper alternative to subsidise free parking in other
:48:20. > :48:27.council run car parks. We do not do that. The economy in Brighton and
:48:28. > :48:33.Hove is doing very well. The fact is that we are incredibly busy, we have
:48:34. > :48:35.a huge challenge with air`quality breaching EU levels. We have
:48:36. > :48:40.gridlock in congestion in the majority of people do not use the
:48:41. > :48:50.car to come into the city. Why use all that money to encourage people
:48:51. > :48:57.to come in by car? Why don't you spend that money to encourage people
:48:58. > :49:03.to come in using other modes of transport? We do. We have travel in
:49:04. > :49:10.`` advisers going out encouraging people to go into the city by bus.
:49:11. > :49:18.We are the least car dependent city in the UK. We have seen a greater
:49:19. > :49:21.use of bus service than anywhere in the UK. It seems as if you're
:49:22. > :49:27.backtracking on your principles. You are worried that we carried out a
:49:28. > :49:30.survey for the BBC South East earlier this year that showed that
:49:31. > :49:44.transport is losing you a lot of votes in the city, you are running
:49:45. > :49:49.scared. In 1999, a group was set up accusing the administration of being
:49:50. > :49:52.anti`car then. This is nothing new. We can make it about the Green
:49:53. > :49:55.administration, the city is very successful, there are more
:49:56. > :50:00.businesses and students than ever before, but there is not enough
:50:01. > :50:04.space. The only way we can transport people around effectively is to
:50:05. > :50:11.encourage them to use the bus and other modes of transport. Nancy, he
:50:12. > :50:16.levelled accusations they are on your party. Free parking is only
:50:17. > :50:19.going to cause more congestion. It will not help the small businesses
:50:20. > :50:24.that need at full top small businesses have said people are not
:50:25. > :50:28.coming into their shops and they are struggling. This is an attempt to
:50:29. > :50:33.say we are trying to help local businesses. We need to say we need
:50:34. > :50:39.to try it first and see what works. If you have spent any time in
:50:40. > :50:43.Brighton and Hove, you cannot get a parking space for love nor money.
:50:44. > :50:50.The queues will be full? Personally, I do not drive and I do not have a
:50:51. > :50:54.car. I would like to see us go one step further and offer free bus
:50:55. > :50:58.travel on those two days. One of those is small business that day and
:50:59. > :51:06.give local businesses a big boost on the run`up to Christmas. What would
:51:07. > :51:14.be good now, would be free bus travel into the city. Richard, you
:51:15. > :51:19.will argue that free parking will boost the local economy. Is it
:51:20. > :51:26.another example of cutting the green crap as coming from number ten this
:51:27. > :51:29.week but Mark I think we have all got to stand back and say,
:51:30. > :51:34.customers, shoppers have got choices. They can shop in
:51:35. > :51:40.out`of`town shopping centres, they can shop online in the single into
:51:41. > :51:45.town. They need to do everything we can to make it a shopper friendly
:51:46. > :51:53.experience going into town. Being `` is it being motorist friendly
:51:54. > :52:02.appealing to voters? It is a fact of life, people drive cars. People from
:52:03. > :52:07.out of town areas need to arrive by car. If you make it an unfriendly
:52:08. > :52:14.experience because it was aggressive parking tactics, it was expensive or
:52:15. > :52:18.the town centre environment was unpleasant, they will take their
:52:19. > :52:25.business elsewhere. Seven Oaks is a different area to Brighton and
:52:26. > :52:29.Hove. In big cities where you have congestion, it will make things
:52:30. > :52:35.worse. We are talking about one or two days here to boost Christmas
:52:36. > :52:38.sales. Instead of the money going to the Council for car parking, it will
:52:39. > :52:43.be channelled towards the small businesses. We have a fantastic and
:52:44. > :52:48.diverse range of shops in all kinds of places to go in Brighton, it is
:52:49. > :52:58.very different, it is not like the usual homogenous high`street in any
:52:59. > :53:02.other city. One size does not fit all? We will leave it all.
:53:03. > :53:06.This part of the world is a very nice part of the world if you can
:53:07. > :53:14.afford it, the conclusion of a report that found survivors and ``
:53:15. > :53:18.surprising levels of deprivation. A person living on one road could be
:53:19. > :53:22.expected to live ten years longer than someone living just a
:53:23. > :53:27.straightaway. In one area of Hastings, 67% of children are in
:53:28. > :53:34.poverty. The national average is 20%. Let's get some more from Cefn
:53:35. > :53:41.Richmond who compiled the research. How much of this research was
:53:42. > :53:45.surprising to you? Sussex is a great place to live if you can afford it,
:53:46. > :53:49.what many people will find surprising is that some of those
:53:50. > :53:57.areas along the coastal strips of Kent and Sussex, is there
:53:58. > :54:00.deprivation is at inner`city levels. The second surprise was if you look
:54:01. > :54:07.at some of the rural areas, there are real pockets of deprivation near
:54:08. > :54:13.that people would not expect. Hackworth and right, there are
:54:14. > :54:22.pockets of deprivation there. `` Hett worth and ride. How much is
:54:23. > :54:28.that masking the problem of deprivation? The South East is an
:54:29. > :54:33.expensive place to live. If you have a lower in come, you have doubled as
:54:34. > :54:39.advantage. Part of the research, we found a family with two children, it
:54:40. > :54:45.would cost you ?74 more to live in a hamlet than a time. If you have that
:54:46. > :54:51.money, that is fine. If you are on a low income, it is a struggle. What
:54:52. > :54:56.should be done? How much should come from the bottom`up, from the, and
:54:57. > :55:00.how much from the government? There is a lot the government should do
:55:01. > :55:06.and is doing. There is a lot of politicians should be debating. Our
:55:07. > :55:09.foundation is about, what can we do? When you look at those areas of
:55:10. > :55:14.disadvantage, there are people working hard at the grassroots to
:55:15. > :55:23.make a difference. That is why we are intervening, we are supporting
:55:24. > :55:26.people within a community to do `` address the problems in their
:55:27. > :55:31.community. How much more could be done by the government to solve
:55:32. > :55:35.these terrible problems? It is a problem in the government has two
:55:36. > :55:43.make the funding available attached to it. But at the end and `` of the
:55:44. > :55:47.day it is the local community that knows about the issues. I was
:55:48. > :55:52.impressed with the jobs the voluntary sector is doing, it is the
:55:53. > :55:57.community that has identified the problems and pressure local
:55:58. > :56:03.authority. I do not know if you have spoken to the local council in Kent
:56:04. > :56:09.recently, but they are making cuts to the most vulnerable in society.
:56:10. > :56:12.We need to make sure that those in greatest need still continue to
:56:13. > :56:18.receive their first year. That is where I see that the efforts of the
:56:19. > :56:27.voluntary sector in the community, are doing such a good job. ``
:56:28. > :56:41.Bayerische. Those statistics are shocking. `` fair share. Your party
:56:42. > :56:49.said you would get rid of child poverty by 2020. The Fort `` I think
:56:50. > :56:52.the poverty figures have gone up. People in poverty, there is one
:56:53. > :56:57.common factor, they do not have any money, and that is down to things
:56:58. > :57:03.like low wages, jobs that are not available, the government has to
:57:04. > :57:07.take some action. We cannot say it is down to community groups. We need
:57:08. > :57:10.to bring back the centres that brought families into a centre where
:57:11. > :57:18.they could get advice on healthy eating, childcare, get jobs in the
:57:19. > :57:20.first place. Those people who desperately need help are
:57:21. > :57:27.necessarily where you think they are. How much is that problem the
:57:28. > :57:31.invisibility of deprivation in some of our communities? I think it is a
:57:32. > :57:36.problem in that it allows some people to ignore it. When you start
:57:37. > :57:40.looking at statistics, but I'm those are people. We need to start talking
:57:41. > :57:45.to people in communities and find out what issues are. Some of them we
:57:46. > :57:51.need better housing, we need sure start centres. We are used to seeing
:57:52. > :57:55.pockets of poverty around the seaside towns of the South East.
:57:56. > :57:59.What is new and different is that we are finding this popping up in the
:58:00. > :58:08.rural areas. That is what I find shop. Many often `` in many cases
:58:09. > :58:13.people are trapped in these situations. They are trapped in that
:58:14. > :58:17.poverty and cannot move. That is what we have to identify and
:58:18. > :58:22.identify with the help is most needed. We are going to have to
:58:23. > :58:24.leave it there. Time for a round`up of the other
:58:25. > :58:40.political events. Hundreds of islanders who settled in
:58:41. > :58:45.Crawley may be a step closer to returning home after the government
:58:46. > :58:50.announced a feasibility study looking at the resettlement. They
:58:51. > :58:55.have been fighting a battle since the 1960s. A local MP said... It
:58:56. > :59:02.seems we are a little bit closer to justice today. Members quit in a row
:59:03. > :59:07.in a report that said there was a dysfunctional organisation. Council
:59:08. > :59:13.leaders said it was full of half`truths and innuendo. Gurkha
:59:14. > :59:20.veterans celebrated after the government set up an enquiry looking
:59:21. > :59:26.into their pension rights. It is going to be looked into now. It is a
:59:27. > :59:30.celebratory day. And manger language. Headmaster wrote to
:59:31. > :59:34.parents asking them not to swear in front of their children will stop he
:59:35. > :59:38.said that parents `` children could not be blamed for turning the air
:59:39. > :59:42.blue as they were only copying their parents.
:59:43. > :59:47.Have you ever sworn in front of your children, Richard? I think it was my
:59:48. > :59:52.children talk me more swear words. Is it times to be modest about
:59:53. > :59:57.swearing? I think we do have to be careful what we see in front of
:59:58. > :00:03.children. It is good to watch your language. It is not nice to see
:00:04. > :00:06.little children swearing. We do not have time for the anecdote of my
:00:07. > :00:09.four`year`old child and a certain four letter word. We will be back
:00:10. > :00:15.next week with more political debate those people who want to cycle. We
:00:16. > :00:23.will be returning to this one. Thank you.
:00:24. > :00:29.A little bit of history was made at Prime Minister's Questions this
:00:30. > :00:32.week. A teensy tiny bit. It wasn't David Cameron accusing one MP of
:00:33. > :00:35.taking "mind-altering substances" - they're always accusing each other
:00:36. > :00:38.of doing that. No, it was the first time a Prime Minister used a live
:00:39. > :00:48.tweet sent from someone watching the session as ammunition at the
:00:49. > :00:52.dispatch box. Let's have a look We have had some interesting
:00:53. > :00:56.interventions from front edges past and present. I hope I can break
:00:57. > :01:01.records by explaining that a tweet has just come in from Tony McNulty,
:01:02. > :01:05.the former Labour security minister, saying that the public are
:01:06. > :01:11.desperate for a PM in waiting who speaks for them, not a Leader of the
:01:12. > :01:15.Opposition in dodging in partisan Westminster Village knock about So
:01:16. > :01:20.I would stay up with the tweets if you want to get on the right side of
:01:21. > :01:24.this one! We are working on how the Prime Minister managed to get that
:01:25. > :01:30.wheat in the first place. What did you think when you saw it being read
:01:31. > :01:35.out? I was certainly watching the Daily Politics. I almost fell off my
:01:36. > :01:40.chair! It was quite astonishing He didn't answer the question - he
:01:41. > :01:44.didn't do that the whole time. But I stand by what the tweets said. I
:01:45. > :01:50.have tweeted for a long time on PMQs. Normally I am praising Ed
:01:51. > :01:54.Miliband to the hilt, but no one announces that in Parliament!
:01:55. > :01:59.Because the Prime Minister picked up on what you said, it unleashed some
:02:00. > :02:04.attacks on you from the Labour side. It did, minor attacks from some very
:02:05. > :02:08.junior people. Most people were supportive of what I said. They took
:02:09. > :02:16.issue with the notion of not doing it until 12:30pm, when it wasn't
:02:17. > :02:20.available for the other side to use. Instant history, and instantly
:02:21. > :02:25.forgettable, I would say. Do you think you have started a bit of a
:02:26. > :02:31.trend? I hope not, because the dumbing down of PMQs is already on
:02:32. > :02:38.its way. Most people tweet like mad through PMQs! Is a measure of how
:02:39. > :02:43.post-modern we have become, we have journalists tweeting about someone
:02:44. > :02:47.talking about a tweet. That is the level of British politics. I am
:02:48. > :02:52.horrified by this development. The whole of modern life has become
:02:53. > :02:59.about observing people -- people observing themselves doing things.
:03:00. > :03:03.Do we know what happened? Somebody is monitoring the tweets on behalf
:03:04. > :03:08.of the Prime Minister or the Tory party. They see Tony's tweet. They
:03:09. > :03:12.then print it out and give it to him? There was a suggestion that
:03:13. > :03:22.Michael Goves had spotted it, but Craig Oliver from the BBC had this
:03:23. > :03:27.great sort of... Craig Oliver was holding up his iPad to take pictures
:03:28. > :03:31.of the Prime Minister, which he then tweeted, from the Prime Minister.
:03:32. > :03:35.People will now be tweeting in the hope that they will be quoted by the
:03:36. > :03:40.Prime Minister, or the Leader of the Opposition. I wasn't doing that I'm
:03:41. > :03:48.just talking about the monster you have unleashed! I hope it dies a
:03:49. > :03:53.miserable death. I think Tony is a good analysis -- a good analyst of
:03:54. > :04:05.PMQs on Twitter. Moving onto the Co-op. You were a Co-op-backed MP,
:04:06. > :04:10.white you? I was a Co-op party member. There are two issues here
:04:11. > :04:15.about the Co-op and the Labour Party. All the new music suggests
:04:16. > :04:20.that the Co-op will now have to start pulling back from lending or
:04:21. > :04:23.donating to the Labour Party, which, at a time when Mr Miliband is going
:04:24. > :04:28.through changes that are going to cut of the union funds, it seems
:04:29. > :04:32.quite dangerous. There are three things going on. There's the
:04:33. > :04:36.relationship that the party has politically with the Co-op party,
:04:37. > :04:42.there is the commercial relationship you referred to, and then there is
:04:43. > :04:47.this enquiry into the comings and goings of Flowers and everybody
:04:48. > :04:53.else. The Tories, at their peril, will mix the three up. There's a lot
:04:54. > :04:59.of things going on with a bang. Labour has some issues around
:05:00. > :05:05.funding generally, and they are potentially exacerbated by the Co-op
:05:06. > :05:11.issue. The Labour Party gets soft loans from the Co-op bank, and it
:05:12. > :05:17.gets donations. ?800,000 last year. Ed Balls got about ?50,000 for his
:05:18. > :05:20.private office. You get the feeling, given the state of the Co-operative
:05:21. > :05:26.Bank now, that that money could dry up. We will see. There's lots of
:05:27. > :05:31.speculation in the papers today At the core, the relationship between
:05:32. > :05:35.the Co-op party and the Labour Party is a proud one, and a legitimate
:05:36. > :05:41.one. I don't think others always understand that. Here is an even
:05:42. > :05:48.bigger issue. Is it not possible that the Co-op bank will cease to
:05:49. > :05:58.exist in any meaningful way as a Co-op bank? Is the bane out means it
:05:59. > :06:05.is 70% owned -- the bail out means that it is 70% owned, or 35% going
:06:06. > :06:10.to a hedge fund, I think I read Yes, there is a move from the
:06:11. > :06:17.mutualism of the Co-op. But don t confuse the Co-op bank with the
:06:18. > :06:24.Co-op Group. Others have done that. I haven't. Here's the rub. The soft
:06:25. > :06:37.loans that Labour gets. They got ?1.2 million from this. And 2.4
:06:38. > :06:41.million. They are secured against future union membership fees of the
:06:42. > :06:46.party. What is Mr Miliband doing? He is trying to end that? You have this
:06:47. > :06:53.very difficult confluence of events, which is, could these wonderful soft
:06:54. > :06:57.loans that Labour has had from the Co-op, could they be going? And
:06:58. > :07:02.these union reforms, where Ed Miliband is trying to create a link
:07:03. > :07:06.between individuals and donations to the Labour Party... Clearly, there
:07:07. > :07:10.could be real financial difficulties here. The government needs to be
:07:11. > :07:13.careful, because George Osborne launched one of his classic
:07:14. > :07:18.blunderbuss operations this week, which is that the Labour Party is to
:07:19. > :07:27.blame for Paul Flowers' private life. No, it's not. And that all the
:07:28. > :07:32.problems, essentially... Look at what George Osborne was doing in
:07:33. > :07:35.Europe. He was trying to change the capital requirement rules that would
:07:36. > :07:39.make it easier for the Co-op to take over Lloyd's. If there is to be a
:07:40. > :07:45.big investigation, George Osborne needs to be careful of what he
:07:46. > :07:48.wishes for. This is another example of the Westminster consensus. All of
:07:49. > :07:51.the Westminster parties were in favour of the Britannia takeover.
:07:52. > :07:57.This is how the Co-op ended up with all this toxic rubbish on its
:07:58. > :08:02.balance sheet. All the major parties were in favour of going to get the
:08:03. > :08:09.Lloyds branches. The Tories tried to outdo Labour in being more
:08:10. > :08:15.pro-Co-op. There was nobody in Westminster saying, hold on, this
:08:16. > :08:18.doesn't work. It is like the financial bubble all over again
:08:19. > :08:23.Everyone was in favour of that at the time. I think there is no
:08:24. > :08:27.evidence so far that the storm is cutting through to the average
:08:28. > :08:32.voter. If I were Ed Miliband, I would let it die a natural death. I
:08:33. > :08:37.would not write to an editorial column for a national newspaper on a
:08:38. > :08:41.Sunday. That keeps the issue alive, and it makes him look oversensitive
:08:42. > :08:49.and much better at dishing it out than taking it. I agree about that.
:08:50. > :08:57.The Labour press team tweeted this week saying that it was a new low
:08:58. > :09:05.for the times. And this was re-tweeted by Ed Miliband. It isn't
:09:06. > :09:10.a great press attitude. It is very Moni. Bill Clinton went out there
:09:11. > :09:15.and fought and made the case. So did Tony Blair. If you just say, they
:09:16. > :09:20.are being horrible to us, it looks pathetic. And it will cut through on
:09:21. > :09:27.Osborne and the financial dimensional is, not political. I
:09:28. > :09:35.shall tweet that later! While we have been talking, Mr Miliband has
:09:36. > :09:39.been on Desert Island Discs. He might still be on it. Let's have a
:09:40. > :09:57.listen to what he had to say. # Take on me, take me on.
:09:58. > :10:01.# And threw it all, she offers me protection.
:10:02. > :10:24.# A lot of love and affection. # Whether I'm right or wrong #.
:10:25. > :10:29.# Je Ne Regrette Rien. #. Obviously, that was the music that
:10:30. > :10:34.Ed Miliband chose. Who thought - you would have thought he would
:10:35. > :10:46.choose Norman Lamont's theme tune! He chose Jerusalem... He has no
:10:47. > :10:56.classical background at all. He had no Beethoven, no Elgar. David
:10:57. > :11:07.Cameron had Mendelssohn. And Ernie, the fastest Notman in the West. --
:11:08. > :11:13.fastest milkman. Tony Blair chose the theme tune to a movie. Tony
:11:14. > :11:22.Blair's list was chosen by young staffers in his office. It
:11:23. > :11:27.absolutely was. Tony Blair's list was chosen by staff. The Ed Miliband
:11:28. > :11:33.this was clearly chosen by himself, because who would allow politician
:11:34. > :11:40.to go out there and say that they like Aha. I am the same age as Ed
:11:41. > :11:52.Miliband, and of course he likes Aha. That was the tumour was played
:11:53. > :12:00.in the 80s. Sweet Caroline. It is Angels by Robbie Williams. I was
:12:01. > :12:04.14-year-old girl when that came out. I thought Angels was the staple of
:12:05. > :12:11.hen nights and chucking out time in pubs. The really good thing about
:12:12. > :12:17.his list is that the Smiths to not appear. The Smiths were all over
:12:18. > :12:22.David Cameron's list. The absolutely miserable music of Morris he was not
:12:23. > :12:30.there. What was his luxury? And Indian takeaway! Again, chosen for
:12:31. > :12:39.political reasons. I would agree with the panel about Aha, but I
:12:40. > :12:44.would expect -- I would respect his right to choose. Have you been on
:12:45. > :12:48.Desert Island Discs? I have. It took me three weeks to choose the music.
:12:49. > :12:53.It was the most difficult decision in my life. What was the most
:12:54. > :12:58.embarrassing thing you chose? I didn't choose anything embarrassing.
:12:59. > :13:12.I chose Beethoven, Elgar, and some proper modern jazz. Anything from
:13:13. > :13:16.the modern era? Pet Shop Boys. That's all for today. The Daily
:13:17. > :13:19.Politics will be on BBC Two at lunchtime every day next week, and
:13:20. > :13:22.we'll be back here on BBC One at 11am next week. My luxury, by the
:13:23. > :13:23.way, was a wind-up radio! Remember, if it's Sunday, it's the Sunday
:13:24. > :13:31.Politics.